H.R. 3248: American Ownership and Resilience Act

The American Ownership and Resilience Act is designed to promote domestic ownership in businesses by supporting employee stock ownership plans (ESOPs) and worker-owned cooperatives. The legislation establishes a financial framework to encourage investments in these models through a domestic ownership succession investment facility. Here are the key components of the bill:

Investment Facility

The act seeks to create a dedicated investment facility that will provide financial leverage specifically for licensed ownership investment companies. These companies are intended to play a crucial role in promoting and facilitating equity ownership among workers through employee stock ownership plans and cooperatives.

Diversity in Ownership Management

To strengthen financial independence, the bill requires diverse management in ownership investment companies. This initiative aims to ensure a variety of perspectives in decision-making processes. In addition, ownership investment companies will be allowed to borrow funds to support their operations. The Secretary of the relevant agency will have the authority to guarantee debentures for these loans under prescribed conditions.

Investment Capital Provision

Ownership investment companies must commit to providing investment capital specifically to covered businesses. However, the bill comes with strict limitations regarding the use of leverage and requires these companies to adhere to detailed reporting requirements. This is intended to maintain transparency and accountability in how funds are utilized.

Management Regulations and Conflict of Interest

The Secretary will be tasked with creating regulations that address potential conflicts of interest affecting the licensees and stakeholders involved with ownership investment companies. This includes implementing necessary public disclosure measures and aligning with existing regulations. Furthermore, the legislation grants the Secretary the authority to suspend or remove management officials for significant violations of established guidelines, while ensuring that procedural due process is followed in such cases.

Summary of Goals

Overall, the American Ownership and Resilience Act aims to:

• Encourage employee ownership to enhance business stability and worker participation.
• Provide a structured financial environment for funding worker-owned models.
• Ensure diversity and fair management within ownership investment companies.
• Implement regulations that safeguard against conflicts of interest and promote transparency.

Relevant Companies

None found